The stabbing attack in an east London underground station was an "abomination ... whatever the circumstances", Iain Duncan Smith said on Sunday.
In the only public response to the attack from a government minister so far, the work and pensions secretary told the BBC's Andrew Marr show that the incident on Saturday night also highlighted the importance of George Osborne's decision not to cut police budgets.
The Metropolitan police are investigating the attack in Leytonstone tube station as a "terrorist incident". One man was left with serious but not life-threatening injuries, while two others sustained minor wounds.
Political reaction to in the incident has been muted so far, with many MPs reluctant to comment before the full circumstances of the attack are known.
Prime minister David Cameron has not responded in public, and Downing Street told reporters Duncan Smith would be speaking on behalf of the government.
He said: "It's an abomination to think of somebody doing this whatever the circumstances are. But this is one of the good reasons why under the spending review we haven't cut the police budget and police will get the money they require to secure the areas that are most threatened by terrorist attacks."
When asked how he would respond to the fact that some people might now be afraid of going into public spaces, Duncan Smith said people should respond defiantly. "We cannot let these sort of people, terrorists, dominate our space," he said.
"The fact is the way we defeat them is that our values – our freedom of expression, our freedom of belief, the freedom that capitalism brings to us, our ability to take our children, our families, out at Christmas – none of that must be curtailed because at the end of it all, that is the reason why they attack us, because we have a moderate state that believes in help and assistance for people".